TDS on Income from Units Purchased in Foreign Currency Introduction Section 196B provides that TDS must be deducted on income from units purchased in foreign currency or long-term capital gains from their transfer when paid to an offshore fund. Key Provisions Deductor:Any person making payments for: o Income from units purchased in foreign currency. o Long-term… Read More »

TDS on Income from Units (Non-Resident) Introduction Section 196A provides that TDS must be deducted at 20% on income paid to a non-resident or foreign company from units of mutual funds or a specified company. Key Provisions Deductor:Any person making payments related to: o Units of a mutual fund specified under Section 10(23D). o Units from a… Read More »

No TDS on Payments to Specified Institutions Introduction No TDS is required on interest, dividends, or other income payable to specified entities, including the Government, RBI, Mutual Funds, and other tax-exempt bodies. Key Provisions Deductor:Any person making payments of interest, dividends, or other income. Deductee:The following entities are exempt from TDS: o The Government o… Read More »

Refund of TDS deducted under Section 195 Introduction A deductor may claim a refund of TDS deducted under Section 195 on any income (other than interest) by filing an application under Section 239A before the Assessing Officer if no tax was required to be deducted on such income. Eligibility for Refund under Section 239A The following conditions must be met:… Read More »

TDS on Payments to Non-Residents Introduction As per section 195, tax must be deducted at source (TDS) on interest or any other sum paid to a non-resident (excluding salary) at the rates prescribed by the Finance Act. Key Provisions Deductor:Any resident or non-resident making payments to a non-resident or foreign company. Deductee:Non-residents or foreign companies receiving… Read More »

TDS on Payment for Transfer of Virtual Digital Assets (VDAs) Introduction As per Section 194S, TDS must be deducted at a rate of 1% on payments made to a resident for the transfer of Virtual Digital Assets (VDAs). Key Provisions Deductor: o Any person (resident or non-resident) making payment for the transfer of VDAs. o In… Read More »

TDS on Benefit or Perquisite from Business or Profession Introduction Section 194R provides that TDS must be deducted at 10% on any benefit or perquisite provided to a resident in relation to business or profession. The tax must be deducted before providing the benefit or perquisite. Key Provisions Deductor:Any person (resident or non-resident) providing a benefit… Read More »

TDS on Purchase of Goods Introduction TDS must be deducted under section 194Q at 0.1% on payments made to a resident seller for the purchase of goods if the buyer’s turnover exceeds Rs. 10 crore in the preceding financial year and the total purchase value exceeds Rs. 50 lakh in a financial year. Key Provisions Deductor: o… Read More »

TDS on Pension and Interest Income of Senior Citizens Introduction Section 194P provides that specified banks must deduct TDS on pension and interest income of senior citizens aged 75 years or more. If tax is deducted under this provision, the senior citizen is not required to file an income tax return. Key Provisions Deductor:Scheduled banks appointed… Read More »

TDS on Cash Withdrawals Introduction Banks, co-operative banks, and post offices must deduct TDS under section 194N on cash withdrawals exceeding specified limits from accounts maintained by the recipient. The TDS rate is 2% or 5%, as applicable. Key Provisions Deductor:Any bank, co-operative bank, or post office making cash payments above the threshold limit. Deductee:Applies to all… Read More »